Correlation Between Eagle Mlp and Global Real

Can any of the company-specific risk be diversified away by investing in both Eagle Mlp and Global Real at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Eagle Mlp and Global Real into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Eagle Mlp Strategy and Global Real Estate, you can compare the effects of market volatilities on Eagle Mlp and Global Real and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Eagle Mlp with a short position of Global Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eagle Mlp and Global Real.

Diversification Opportunities for Eagle Mlp and Global Real

0.2

Correlation Coefficient

Eagle Mlp  Global Real

Modest diversification

The 3 months correlation between Eagle and GLOBAL is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding Eagle Mlp Strategy and Global Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Real Estate and Eagle Mlp is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Eagle Mlp Strategy are associated (or correlated) with Global Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Real Estate has no effect on the direction of Eagle Mlp i.e., Eagle Mlp and Global Real go up and down completely randomly.

Pair Corralation between Eagle Mlp and Global Real

Assuming the 90 days horizon Eagle Mlp Strategy is expected to under-perform the Global Real. In addition to that, Eagle Mlp is 2.2 times more volatile than Global Real Estate. It trades about -0.11 of its total potential returns per unit of risk. Global Real Estate is currently generating about 0.27 per unit of volatility. If you would invest  2,914  in Global Real Estate on December 5, 2024 and sell it today you would earn a total of  92.00  from holding Global Real Estate or generate 3.16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Eagle Mlp Strategy  vs.  Global Real Estate

Eagle Mlp Strategy

Risk-Adjusted Performance

Weak

Over the last 90 days Eagle Mlp Strategy has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Eagle Mlp is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Global Real Estate

Risk-Adjusted Performance

Very Weak

Over the last 90 days Global Real Estate has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Global Real is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Eagle Mlp and Global Real

The main advantage of trading using opposite Eagle Mlp and Global Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eagle Mlp position performs unexpectedly, Global Real can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Global Real will offset losses from the drop in Global Real's long position.

The idea behind Eagle Mlp Strategy and Global Real Estate pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.